Alcohol impairs judgment, and impaired judgment can lead to damage, injuries and even death. In Pennsylvania, if you serve alcohol to a person who causes damage, injury, or death, you may be held liable. And in addition to the costs related to damage and injuries, you may also find yourself on the wrong end of a lawsuit.
Are You Protected in a Potential Lawsuit Against Your Restaurant Business?
One nasty lawsuit can significantly affect your bottom line or even put you out of business. While you may not be able to control all of your customers’ actions, there are steps you can take to protect your business such as knowing the laws in your state, knowing how to identify when someone is drunk, and having Liquor Liability Insurance as part of your restaurant insurance policy.
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Pennsylvania’s Dram Shop Law
Pennsylvania is one of 43 states that has a Dram Shop Law, which means that a business or individual who serves alcohol to a visibly intoxicated person is legally responsible for any injury or damage that person might cause.
Restaurants, bars, clubs, taverns, or any other business that serves alcohol – whether it’s beer, wine, or spirits could end up paying the bill for damages done by an intoxicated customer.
That means that if you serve alcohol to someone who is “visibly intoxicated” and they get into a fight at your bar, one or both parties can sue you. If you serve someone who is “visibly intoxicated” and they fall and hurt themselves on the way to their car, they can hold you responsible for their injuries. If you serve alcohol to someone who is “visibly intoxicated,” and they cause an accident driving home, you may be held responsible for damage and injury to all parties involved.
The Law Applies to Private Events as Well
Dram Shop law applies not only to businesses that serve alcohol, like bars and restaurants but also to private events and can apply to someone committing other liquor violations, such as serving alcohol after hours or to minors.
An Ounce of Prevention is Worth a Pound of Cure
Of course, your best bet is just not to serve “visibly intoxicated” customers and avoid the damage or injury before it happens. But sometimes that’s easier said than done.
In Pennsylvania, driving with a Blood Alcohol Concentration (BAC) of .08 or higher is illegal, but according to the NHTSA, “… even a small amount of alcohol can affect driving ability. In 2016, there were 2,017 people killed in alcohol-related crashes where drivers had lower alcohol levels (BACs of .01 to .07 g/dL).”
AlcoMeters Breathalyzer offers this chart to help estimate how many drinks will impair a person’s judgment. But remember, everyone absorbs and metabolizes alcohol at different rates. Things like weight, sex, medication and even what a person eats can affect their BAC, so the chart is just an estimate. Sometimes you need to use your best judgment.
Here are seven signs that a person may be intoxicated:
- Slurred speech
- Glassy or bloodshot eyes
- Change in behavior
- Difficulty finishing a thought or sentence
- Stumbling or falling
- Impaired fine-motor skills (such as trouble opening their wallet and paying for a drink)
- Slow reaction time
Even if you identify someone who is drunk, it isn’t always easy to cut them off. Here are some tips:
- Tell someone else like a manager or another bartender if you’re cutting someone off.
- Enlist help from the customers’ friends.
- Calmly explain your policies and don’t be confrontational.
- Trust your judgment and stick to your decision.
- Offer to call them a taxi.
- If they become belligerent, call security or the police.
But, as you know, all best-laid plans can go awry, and that’s where Liquor Liability can become a safety net.
What is Liquor Liability Insurance?
Liquor Liability Insurance helps protect companies that manufacture, sell, or serve alcohol. It covers damages caused as the result of selling, serving, or furnishing alcoholic beverages and the cost of defending against any lawsuits filed by the intoxicated customer and/or their victim.
It’s important to note that your Commercial General Liability (CGL) insurance may not cover when alcohol is involved. Plus, some banks require Liquor Liability Insurance and many states insist on it if you have a liquor license. In Pennsylvania, the Liquor Control Board requires current liquor liability coverage for $1 million per occurrence and $2 million aggregate.
Don't Risk It
Without Liquor Liability Coverage, you could find yourself responsible for damage and injury costs, legal fees, and civil damages that can ruin your reputation, will most certainly hurt your bottom line, and could potentially put you out of business.
Take No Chances - Get the Right Coverage at a Great Price
The experienced agents at American Insuring Group specialize in Restaurant Insurance. We can help you get the right insurance to protect your business.
Our independent agents are free to shop the entire insurance market among many competing insurance providers. That means savings for you! Give us a call at (800) 947-1270 or (610) 775-3848 or contact us online to start saving.
